Freelancers Guide: Billable vs. Non-Billable Hours

Are you web designer or developer that bills clients by the hour? Let me know if this situation sounds familiar: you're up to your elbows in a project and you suddenly realize you've spent half the day troubleshooting an unanticipated hurdle.

"Eek, this isn't good. Is my client going to be mad at me because of how long this is taking?"

Relax, a lot of freelancers and contractors go through similar situations.

When we're writing up proposals for projects, it can be really difficult to estimate how long certain steps are going to take. So we end up putting in all this time and effort and then asking ourselves, "should I be billing all this extra time even though it wasn't specifically outlined in the contract?"

The short answer is probably. The long answer is a little bit more complicated…

What exactly is Billable Work?

We define billable work as having the following components:

You're doing something that is directly related to this contract

You wouldn't be doing this if it wasn't for this contract

It's reasonable that you should be doing this

Let's say you're developing a website for a local company and you're using Wordpress. Your client selects a theme that they like the general look of, but want to make some pretty significant visual changes. While making these changes, you notice a bug that keeps inadvertently truncating some text.

You end up digging into some PHP. An hour later and you get it figured out. Obviously, there was no way to foresee this extra time. You start to question whether or not you should bill the client for your time. The important thing is that this work meets all of the criteria above.

Of course, if you decide to write up a detailed blog post about the bug or spend hours in the theme developer's forums discussing it, that's on your own time. It may have been inspired by the project but it doesn't add any value to the client.

What is Non-billable work?

Let's take a look at another situation. What if you're designer and a client is looking to unload a whole bunch of production work on you (it may not be fun, but the hours are definitely going to be there).

During the initial meeting, they ask you if you're an expert with the pen tool. How you answer this question can have a big effect on what determines billable and non-billable time.

If you are an expert with a tool (language, framework, etc.), you should say it proudly. If you're not, you better make that clear. Don't over-promise and then expect the client to pick up the tab for your education.

This situation is also a great opportunity to let your client know that it may take you a few hours to catch up, but you should be good to go after that. They may be totally OK with you billing them for your "catch up" time. As always, clear communication goes a long way. This situation is only going to go awry if promise something that you can't deliver.

Knowing Your Limits

With all of the resources and tutorial out there nowadays, it can feel like learning something new is just a Google search away.

But sometimes these tutorials can take way, way longer than expected. Sometimes the docs aren't all that they promised to be.

So if you find yourself in a situation where your billable "research" time is taking way longer than expected, it may be up to you to eat the costs. It can be tempting to tack on a couple hundred bucks to the project but it may hurt you in the long run. Once a client realizes that one of their freelancers is constantly over promising and under delivering, they're going to start shopping around for a better communicator.

So, know your limits. Don't assume that you'll pick up a new technology as quickly as you might have done in the past (also, don't forget to ask yourself if a specific project should be billed at a flat rate, rather than hourly "Hourly vs. Project Billing"). You may be sacrificing some cash but you'll be picking up new skills).